BV Zahlungssysteme:

Challenge

BV Zahlungssysteme GmbH is based in Cologne, Germany. It was founded in 2006 as a subsidiary of Bank-Verlag GmbH and specialises in the implementation and technical operation of highly secure specialist banking IT applications. Its portfolio is focused on three core areas: cards and card-supported payment systems; electronic banking and trusted services; and banking application services. The company also consults in the development of customer-specific concepts and software-based solutions. In order to be able to provide these services more effectively to its banking partners – primarily member institutes of the federal association of German banks – BV Zahlungssysteme decided to set up a powerful extranet.

The company had reached its customers – which include some 240 German financial institutions – via a network based largely on X.25 data lines. Stefan Breschinski, Head of the Banking Applications Services Business Sector at BV Zahlungssysteme, explains: “The private financial sector is facing enormous challenges. We see our services as neutral in terms of competition and as an important platform for the industry. We do however make very high demands on our service levels and to support this we recognised that our technological infrastructure needed adaptation.”

BV Zahlungssysteme developed a list of requirements for a planned new extranet. The network needed to be fast, reliable, secure, expandable, and reasonably priced for users. Based on a high performance standard, it was intended not just to allow faster and cheaper information exchange with customers, but also to support BV Zahlungssysteme in the development of additional IP-based services in the future.

Solution

Using BT IP Connect global MPLS (multi-protocol label switching) technology, the new extranet is based on an ultramodern network standard and – embedded in a VPN (virtual private network) structure – combines high transmission rates with maximum security.

As security and availability requirements are particularly high in the banking field, the project team is leaving nothing to chance in planning the changeover. Initial pilot schemes have already been completed, including one with a large German bank. The link-up, including all the processes involved – right down to the need for a possible network repair – have been developed and successfully validated. The reliability of transmission routes at network level has also been thoroughly investigated through load and stress tests. Moreover standardised application tests have served to check how the customer can implement the various services in practice.

This includes, for example, the question of whether the complex routing system of approvals of card payments – between all the partners involved from the financial sector and the retail trade – functions around the clock. The results have been positive and Stefan Breschinski acknowledges: “The project manager is highly satisfied with the quality of the extranet so far; it is now up to us to consistently tie in ever more customers over the coming months.”

Demand for the various added value services developed by BV Zahlungssysteme is as individual as the speed with which the switch to the extranet – known as SIPNET – is carried out. Right from the start, the new technology was planned to be a permanent investment and not an interim solution. So in future, it will be possible to switch to IP telephony, for example, should the need arise as and when BV Zahlungssysteme customers are ready for it.

Stefan Breschinski explains: “Whilst the major banking institutes have their own large IT departments, it is primarily the smaller customers who benefit from accessing our additional services. We already provide a whole range of different applications that we can now group together and offer with greater security via the extranet. For us the new communications platform is also the technological basis for further offers which we still have to develop.”

Value

BT IP Connect global provides the option of prioritising selected data and offers an ideal basis for the many IP-based services of BV Zahlungssysteme such as card authorisation, online banking, or investigation orders relating to payments documents. The network allows data relating to business-critical applications, such as the authorisation of payments, to be given priority over less time-critical tasks such as the exchange of electronic keys or files. Stefan Breschinski says: “Our new extranet meets our expectations and so far we have found the first pilot schemes involving our customers convincing.”

Stefan Breschinski also acknowledges another industry-specific benefit of the new connectivity: “The rules relating to SEPA – the project currently being implemented in the standardised Euro payment area – mean that the type of message given with payments is gradually changing. It contains more information, so in the future it will require greater line capacity for transmissions.” With data lines based on older, usage-dependent standards, the transmission time and costs involved would have increased as the data volume grew. The costs for transmission using BT IP Connect, on the other hand, will fall noticeably, because billing is on a defined flat rate.

According to calculations by Stefan Breschinski: “Banks wishing to use our services still have to sort out the connectivity of their applications themselves, but with BT IP Connect they now have an ideal technological basis for transaction transmissions, which could save them up to 50 per cent in the short term, compared with previous settlement costs.”

Stefan Breschinski adds: “We expect major synergies in the future from our co-operation with BT. We are planning, for example, to offer financial institutes further intelligent added value services in association with BT. Continuous development of services offering added value determines our future position in the market.”

Dr. Wolfgang Dahl, Managing Director, BV Zahlungssysteme, sums up: “Through our new extranet, we are able to offer customers ultramodern IP-based services. BT has proved to be the ideal strategic partner for this project and we are benefiting from its technological expertise as well as its financial sector know-how.”